Extractive Industries

“Carancheras” in the Banks of the Madre de Dios river in Peru.

The term “extractive industries” refers to the companies and agencies which physically extract metals, minerals and aggregates from the earth and specialize in their production and utilization. Examples of these non-renewable natural resources or raw materials are oil, gas, gold, coltan, diamonds, etc. Over the years, advocates and scholars have documented that in developing countries, the national wealth created from the extraction of these non-renewable natural resources has often failed to benefit the poor of the country and devastated local communities. This “natural resource curse,” when communities in the developing world find they have no or little access to the wealth of domestic resources, has led to clashes for control of the newly-created wealth. Such conflict impacts powerless people and sometimes pushes them even deeper into poverty.

A little more than a decade ago civil society — the collection of voluntary civic and social organizations operating alongside governments and businesses — began addressing how extractive industries affect the poor and the environment. Of particular influence has been Publish What You Pay, a global network of civil society organizations campaigning for transparency in the extractive industries. This network was founded in 2002 by several organizations including CRS’ counterpart, CAFOD — the official Catholic aid agency for England and Wales.

Catholic Relief Services and Extractive Industries

Catholic Relief Service works in 43 resource-rich countries where the government collects more than 25% of its revenues or foreign exchange earnings from oil, gas or mining. In 16 of these countries, CRS has had projects to address some of the problems associated with natural resource extraction. CRS was among the first international development non-governmental organizations (NGOs) to take a public stance on issues related to extractive industries and equity. Our 2003 publication, “Bottom of the Barrel: Africa’s Oil Boom and the Poor” was among the earliest comprehensive examinations of the effects of oil exploitation on the most vulnerable in Africa. CRS has worked with Church partners around the world to address the development failures that have resulted from the extractive industries and supported regional and international efforts that promote responsible extractive industries operations and the common good. For example, in Peru, where the economy is highly dependent on mining, CRS’ Civil Society and Governance project has helped empower local leaders and their organizations to effectively advocate for more responsible natural resource exploitation.

An Example: Extractive Industries and Nigeria

One of the most striking examples of environmental damage as a result of exploitation of natural resources is from Nigeria. Located in Sub-Saharan Africa, Nigeria has a hugely diverse population of 140 million people. It is also the 12th highest oil producing country. While it has amassed huge wealth from its natural resources, Nigeria has remained one of the poorest countries in the region. In one of the main oil producing regions in the country, the Niger Delta, the environmental damage has destroyed farmland and polluted the community’s water and fishing areas.

CRS has supported the Catholic Church and the Center for Social and Corporate Responsibility in their efforts to build the capacity of Niger Delta communities in four oil-producing states to demand greater accountability and transparency from oil companies and state and federal governments.

Learn more about CRS’ work in Nigeria here.